Robert R. Bliss
Yearly collections fall $2.620 billion or 12.5 percent; June is $255 million below benchmark
Revenue Commissioner Navjeet K. Bal today announced that preliminary revenue collections for FY09 were $18.259 billion, a decrease of $2.620 billion or 12.5 percent from FY08 collections. The total collection is about $3.2 billion less than the original FY09 estimate of $21.402 billion, an estimate that was revised downward four times during the course of FY09, and $177 million less than the most recent revision of the benchmarks in May.
"In the past 12 months the Commonwealth saw one of the steepest declines in revenue collection ever due to a major global economic crisis. The drivers of FY08's record revenue collections - income tax paid on capital gains, dividends and interest, settlement of some large tax cases, and strong withholding tax collections - all fell dramatically in FY09," said DOR Commissioner Navjeet K. Bal.
For the year ending June 30, income tax collections totaled $10.584 billion, a decrease of $1.900 billion or 15.2 percent, $45 million below the benchmark. Withholding declined $148 million or 1.6 percent and was $11 million below the yearly benchmark, while income from tax estimated payments which include capital gains, dividends and interest declined $713 million or 28.6 percent, which was $51 million below the benchmark. Refunds were $1.550 billion, up $216 million or 16.2 percent and $22 million over benchmark. Income tax payments with returns and bills declined by $825 million, or 36.4 percent, $39 million above the benchmark.
Sales tax, considered a key indicator for consumer spending and confidence, was $3.869 billion, down $218 million, or 5.3 percent. Within the three main categories of sales tax, only meals tax collections of $630 million, down $3 million or 0.5 percent from the previous year came close to holding their own.
Corporate and business tax collections of $2.099 billion for the year were down $450 million, or 17.6 percent. Only corporate excise tax collections of $1.549 billion, $37 million more than last year or 2.4 percent higher, exceeded the previous year's collection. The financial institutions excise tax collection of $243 million declined $305 million or 55.7 percent from the previous year. Although much of this decline was due to non-recurring settlement payments received in FY08, public utilities excise tax collections were negative for the year (meaning refunds were higher than taxes collected), a decline of $122 million from FY08.
Revenue collections for the month of June were $1.791 billion, $472 million less than the previous June, a decline of 20.9 percent and $255 million below benchmark, with below benchmark performance in income and corporate/business taxes, but slightly above benchmark in sales tax.
Income tax collections for June were $890 million, down $347 million or 28.0 percent from a year ago, $124 million below benchmark. Income tax estimated payments of $279 million were down $239 million or 46.1 percent from a year ago, $50 million below benchmark. Withholding tax collections of $681 million were down $55 million or 7.4 percent below a year ago, $40 million below benchmark.
Sales and use tax collection of $332 million was down $16 million or 4.7 percent from June 2008, but was $7 million above benchmark due to slightly stronger than forecast collections of regular and motor vehicles sales taxes.
Corporate and business tax collections of $419 million were down $94 million, or 18.3 percent from a year ago and $147 million below the monthly benchmark.June 2009 Tax Collection Summary (preliminary as of July 16, 2009)